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Non-Tech : ACCO: 800America.com, Inc
ACCO 3.445+0.3%3:59 PM EST
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From: LTK0071/21/2007 4:49:32 PM
   of 694
 
SugarCane vs Corn in ethanol <<To: schzammm who wrote (78484) 1/21/2007 12:41:26 PM
From: elmatador of 78492

There’s a cheaper way to energy independence

America’s policy of subsidizing ETHANOL production has been justified as a route to national energy independence.

It’s more like a route to happy farmers.

Corn and soybean prices have surged in large part because of the demand for biofuels. But there is a lower-cost way to reduce dependence on the Organization of Petroleum Exporting Countries: Open the borders to imported ETHANOL.

Biofuels can be an efficient source of energy. Look at Brazil. It produces 4.8 billion gallons of ETHANOL a year from SUGAR cane, and ETHANOL has replaced 40 percent of the country’s gasoline consumption. That’s enough to make the country energy-independent. The plan has worked well because a gallon of ETHANOL made from SUGAR cane produces as much as 10 times the energy required to produce it.

But the U.S. doesn’t have the right climate for SUGAR cane production in quantity. So the government has turned to corn and soybeans, both crops subject to subsidies. The problem with that policy is that neither of these crops has a high net-energy balance. A gallon of soybean ETHANOL generates three times the energy it costs to produce it, while corn-based ETHANOL makes a pathetic 1.3 times its cost of production.

This all may make sense in Iowa, but it is enough to make any economist shudder. In a free market, the domestic production would be swept away by the more efficient foreign product. But this is far from a free market. The U.S. combines a high tariff on bioETHANOL imports and a requirement that the fuel make up 10 percent of gasoline. So the market is strong, but the import share is less than 5 percent.

Energy independence isn’t a bad idea for the U.S., not with the many unfriendly members of OPEC supplying 52 percent of the country’s oil imports.

But fully domestic production comes at a high cost. SUGAR cane from the Caribbean is a much more attractive way forward.>>
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